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The President of the Lebanese Republic, Whereas the Lebanese Constitution, Whereas Law No. 45/67 of 5/6/67 granting the government the right to legislate, by decrees emanating from the Council of Ministers , in economic and financial matters, and in public safety, internal and general security matters, On the proposal of the Minister of Justice and the Minister of National Economy, Following consultation with the State Council, And after approval of the Council of Ministers held on 19/7/1967, Decrees what follows: Article 1(as modified by the Law promulgated by Decree No. 9639 of6 February 1975) The commercial representative is the Agent who, within the framework of his usual and independent profession, and without being bound by an employment agreement, undertakes negotiations for the conclusion of operations of sale, purchase, hire and services and, should the occasion arise, carries on such activity in the name of producers or merchants and for their account. Equally considered commercial representative is the merchant who sells for his account what he has bought by virtue of a contract giving him the character of an exclusive representative or distributor. Dating from the enforcement of the present law, while maintaining previous vested rights and taking into account the reciprocity that non-Lebanese commercial representatives shall be required to prove, the commercial representative shall be required to be a Lebanese national and have a commercial establishment in Lebanon. In case the commercial representative is a company: A - For partnerships and limited liability companies: It is required that the majority of partners should be Lebanese nationals, that the greater part of the capital should belong to Lebanese nationals, and that the person entitled to sign should be a Lebanese national. B - For joint-stock companies: It is required that shares should be registered, that the greater part of the capital should belong to Lebanese nationals, and that two thirds of the members of the Board as well as the General Manager or the person delegated by the Board Chairman or by the General Manager to discharge all or certain duties of management, should be Lebanese nationals. Article 2 (as modified by the Law promulgated by Decree No. 9639 of6 February 1975 (and by Law N¡ã 671 of5 February 1998: Any contract of commercial representation which shall be concluded after the enforcement of the present decree-law shall have to be made out in writing and may be valid for a determined or an undetermined period. This contract may include a clause entrusting representation to a single agent or stipulating the guarantee by the agent of the buyers' solvency ( del credere), or a clause entrusting the goods in consignment so that they may be delivered to customers. The clause of exclusive representation is operative against third parties only if it is entered by the Agent in the Trade Register; it shall not apply to foodstuffs, excepting products of special consumption that shall be determined by decree emanating from the Council of Ministers following consultation with a Commission that shall be made up of the Director General of Economy and Commerce, of a representative of the Syndical Chamber of Commercial Representatives in Lebanon, of a representative of the General National Federation of Cooperative Societies, of a representative of the General Confederation of Workers, and of a representative of the Chamber of Commerce and Industry. Such Commission shall be designated by decree emanating from the Council of Ministers. Exclusivity of commercial representation for foodstuffs may be revived by decree emanating from the Council of Ministers following consultation with the Commission referred to in the preceding paragraph, when economic circumstances permit. An annual tax of LL 500,000 (five hundred thousand Lebanese pounds) is levied on each contract of commercial representation registered with the Ministry of Economy and Commerce. Article 3 The trade representative is independent in the organisation of activities pertaining to his quality of representative and to his usual trading activities.more specifically he may: 1 - Transact commercial operations for his own account. 2 - Accept the representation of other firms without reference to his first Principal, on condition that the new representation does not conflict with the first and that it does not stand competitive thereto. 3 - Appoint sub-agents or use the services of employees who shall receive from him a fixed salary or a commission. The latter shall have no connections with his Principals. In this case, the secondary representatives shall be submitted either to the provisions of the present decree-law, or to those of the Code of Labour, in accordance with their condition. Article 4 (as modified by the Law promulgated by Decree No. 9639 of6 February 1975) The commercial representation contract must be considered as having been concluded in the joint interest of the contracting parties. Thus, breach of the contract by the Principal without any of the Agent's fault or other valid cause, entitles the latter, notwithstanding any agreement to the contrary, to claim for compensation equivalent to the damage sustained and to the unrealised profit. Likewise, the commercial representative is entitled, even when the contract has come to expiry, and notwithstanding any agreement to the contrary, to claim for compensation which the Court shall assess, if his activity has promoted with manifest success the launching of the trade mark represented or has increased the number of its customers, while he is not enable to reap the fruit of this success because of his Principal's refusal to renew the representation contract. 1 - A special register shall be established in the Ministry of Economy and Commerce for Companies and Establishments wishing to handle commercial representation in Lebanon, in which they shall have to be registered, and wherein a sheet shall be opened for: A - Any company whose representation contract has been recorded by its Agent in his special register, as from the enforcement of the present law. B - Any company being prosecuted on the basis of the provisions of Decree-Law No. 34 of 5 August 1967 and its amendments. C - Any company against which has been passed an unexecuted judgment. 2 - The two following mentions may be recorded on the sheet of any company: A - Mention of legal proceedings instituted by virtue of Decree-Law No. 34 of 5 August 1967 and its amendments, which shall be recorded upon presentation of summons, copy of which shall be notified to the Ministry of Economy and Commerce (Special Register). B - Mention of a final judgment passed against it by virtue of Decree-Law No. 34 of 5 August 1967 and its amendments. 3 - A new representative may represent a company on the sheet of which mention of a case has been entered, and he may register his representation on his special trade register, on condition that, during the 3 -month period dating from the delivering of an irrevocable judgment against that company by virtue of Decree-Law No. 34 of 5 August 1967 and its amendments, he shall choose between: Execution of the judgment in lieu of the convicted company, reservmg his right to proceed against the latter. Definitive relinquishment of the representation of that company and acceptance of the striking-off of the representation on his special register. 4 - The company against which an irrevocable judgement has been passed shall be barred from being represented in Lebanon so long as it has not carried out by itself the judgment against it or that its new representative has not carried out that judgment while reserving his right to proceed against it. 5 - A former representative shall be entitled, in the event of the recording of a mention of irrevocable judgment by virtue of the provisions of Decree Law No. 34 of5 August 1967 and its amendments on the sheet of the company that he represented, to notify the Customs Directorate of the purport of the judgment so that the clearing of imported merchandise, manufactured by the convicted company, shall be authorised only after the importer has produced a certificate testifying that the mention on the company sheet has been lifted. Article 5 Notwithstanding any agreement to the contrary, the Courts of the place where the commmercial representative exercises his activity are competent to adjudicate disputes arising from the contract of commercial representation. Article 6 The present decree-law shall be published in the Official Gazette. Representation contracts prior to its enforcement, whether they are written or established by other means of proof valid by virtue of a former legislation, shall be submitted to the provisions of the present decree-law. Beiteddine, 5 August 1967 Signed: Charles Helou By the President of the Republic The President of the Council of Ministers Signed: Rashid Karame The Minister of Justice Signed: Fouad Rizk The Minister of National Economy Signed: Said Hamade |
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